According to the new classical school, an expected increase in government spending is associated with:
a. a downward movement along the long-run Phillips curve.
b. an upward movement along the short-run Phillips curve.
c. a parallel outward shift of the long-run Phillips curve.
d. an upward movement along the long-run Phillips curve.
e. a downward shift of the short-run Phillips curve.
d
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Which of the following contributed the most to the economic stability and strong growth of real GDP during the 1980s and 1990s?
a. the rapid growth of government expenditures throughout most of the period b. congressional policies that persistently balance the budget c. modifications in fiscal policy that stimulated aggregate demand during economic slowdowns and restrained it during periods of economic boom d. Federal Reserve policies that kept the inflation rate low and relatively stable
Use the following table to answer the question below. Jane's Production Possibilities SchedulePounds of Green BeansPounds of Corn08020604040602080 0Jane's production possibilities schedule demonstrates that she
A. does not face an opportunity cost when producing green beans. B. faces an opportunity cost when producing green beans. C. can produce an unlimited amount of corn if she gives up enough green beans. D. cannot produce green beans and corn together.
People who are unemployed because of job search are best classified as
a. cyclically unemployed. b. structurally unemployed. c. frictionally unemployed. d. discouraged workers.
Suppose that a town has two major bottling plants. One of these bottling plants is unionized and the union has just negotiated a 7% wage increase each year for the next two years. Which of the following is most likely to occur?
A. The only effect will be that the price charged by the unionized bottling plant will increase to cover the additional costs of labor. B. The price of labor will change in both the unionized and nonunionized bottling plants, but no other input markets will be affected. C. The price of labor will change in both the unionized and nonunionized bottling plants. Employment of labor and other inputs is also likely to change in both bottling plants. D. The price of labor in the unionized bottling plant will increase, but there will be no changes in the price of labor in the nonunionized bottling plant.